Amazon Needs More Whole Foods Stores

Amazon (NASDAQ:AMZN) just took another step in unleashing the power of Whole Foods. The e-commerce giant said it would start offering discounts for Prime members on Whole Foods items that are already on sale. The company said members of its loyalty program will get an additional 10% off sale items, starting with stores in Florida this week as it rolls out the program nationwide this summer.

It’s the latest example of Amazon’s leveraging Whole Foods to add more weight to Prime, which the company recently said reached 100 million members. Amazon has begun offering free two-hour delivery for Prime members from Whole Foods locations in some markets and plans to make it available at stores nationwide by the end of the year. With those discounts and two-hour delivery both in place in that time frame, Amazon will have a powerful value proposition for Prime customers and potential sign-ups. However, its competitors aren’t standing still.

Image source: Amazon/Whole Foods.

Target (NYSE:TGT) acquired Shipt last year to help it enable same-day grocery delivery, and announced this week that Target Restock, its next-day delivery service for non-perishables is available nationwide. The service is free for Target REDcard holders or costs $2.99 per delivery otherwise.

Walmart (NYSE:WMT) is aggressively expanding its grocery pickup service with plans to make it available at more than 2,000 stores in the U.S. by the end of the year, and the company is ramping up its own grocery delivery with plans to deliver from 800 stores in 100 metro areas, making grocery delivery available to 40% of U.S. households. Meanwhile, its membership-based warehouse chain, Sam’s Club, recently partnered with Instacart to enable same-day grocery delivery.